The 5Cs Framework for Deep Tech Founders
- Barry Nolan
- Oct 10
- 5 min read
Framework at a glance:
Company — Do you own the science? Can you execute the science?
Context — Why now?
Customer — Who's proving it works? Can you proves the market wants it?
Competition — What's uncopyable? Poove you'll capture and keep value
Capital — How do you derisk smartly? What does it take? What will the returns be?
1. COMPANY — Team, IP, Capability
What it is: The people and the proprietary science that make your venture possible.
Why it matters: Investors back founders who can execute from lab to market, protected by IP that creates compounding advantage.
Core elements to track:
Founding team depth
Domain expertise (years, publications, patents)
Prior startup/scale-up experience
Key hires secured for reliability, manufacturing, or safety
IP position
Patents filed/granted with claims summary
Trade secrets and proprietary datasets
Freedom-to-operate (FTO) analysis
Competitive IP landscape assessment
Execution cadence
Technology readiness level (TRL score and trajectory)
Technical milestones achieved vs. roadmap
Proof points: lab results → prototypes → pilot deployments
Key technical risks and de-risking progress
Build/test cycle velocity and learning rate
Early traction
LOIs, pilot agreements, design wins
Non-dilutive funding (SBIR/STTR, grants, awards)
Strategic partnerships
Pitch framing: Show your unique breakthrough and "why now," map your IP moat (patents + know-how + data), and name the owner of "the hard bits" to signal execution credibility.
2. CONTEXT — Inflection & Timing
What it is: The external trigger that makes your science commercially viable now.
Why it matters: Great technology with bad timing fails. VCs need to see a clear catalyst that creates a market opening within your funding runway.
Core elements to track:
Catalyst identification
Physics constraint removed or cost curve crossing
Regulatory/policy shift creating urgency
Supply chain disruption or enabling technology maturity
Standards adoption opening new markets
TRL progression
Current TRL → next TRL with objective exit criteria
Timeline to market readiness
Certification or standards gates and expected timing
Market opening dynamics
Beachhead customer segment with active budget
Procurement pathways and decision timelines
Policy tailwinds (incentives, mandates, regulations)
Geopolitical constraints or advantages
Pitch framing: "Last year impossible because X; now feasible/inevitable because Y." Show the TRL ladder and what each step unlocks—buyers, standards, scale economics.
3. CUSTOMER — Credibility & Integration
What it is: Real-world proof that someone wants it, will pay for it, and can integrate it.
Why it matters: Field validation (not lab demos) moves TRL forward and proves commercial viability. One paying anchor customer de-risks everything.
Core elements to track:
Proof of demand
Paid pilots, design-ins, or contracted LOIs with scope of work (SOW)
Success metrics and milestone dates in customer agreements
Reference customers willing to speak with investors
Field performance benchmarks
Performance vs. incumbent on 2-3 decisive KPIs (yield, accuracy, cost/unit, latency, energy use)
Customer pain point quantification (time savings, cost reduction, performance improvement)
Integration requirements and requalification burden
Revenue path clarity
Pilot → pre-production → production conversion funnel
Sales cycle length and buying process
Budget authority and procurement requirements
Customer lifetime value (LTV) and acquisition cost (CAC) trajectory
Market sizing
TAM/SAM/SOM with bottom-up validation
Beachhead strategy rationale
Adjacent market expansion path
Pitch framing: Lead with one anchor engagement (who, what, when, success metric).
4. COMPETITION — Cornered Physics & Switching Costs
What it is: Why no one else can easily catch you—structural moats and painful replacement costs.
Why it matters: Deep tech requires massive capital. VCs need to see defensibility that justifies the investment and prevents commoditization.
Core elements to track:
Structural moats
Protected process or manufacturing know-how
Data flywheel or proprietary datasets
Supply chain exclusivities or learning curves
Integration lock-in (standards, certifications, ecosystem position)
Competitive landscape
Direct competitors: technology approach, stage, funding, strengths/weaknesses
Substitutes including "do nothing" and incumbent workarounds
Emerging technologies that could disrupt your approach
Switching costs quantified
Redesign time, requalification burden, or recertification requirements
Integration complexity (firmware, calibration, system-level changes)
Customer-specific customization or training investment
Differentiation proof
10x better on specific metrics (not 10% incremental)
Architectural or physics-based advantage rivals can't copy cheaply
Time-to-market lead and why it compounds
Pitch framing: Show you're "different by design," not incrementally better.
5. CAPITAL — Milestones, Intensity & Efficiency
What it is: How you deploy capital to kill risk step-by-step and achieve scale economics.
Why it matters: Deep tech is capital intensive. VCs want to see disciplined milestone planning and leverage of non-dilutive funding.
Core elements to track:
Milestone staircase
Proof of physics (binary technical risk retired)
Proof in field (paid pilot with spec verification)
Proof at scale (yield improvement, COGS reduction, margin expansion)
Each milestone with KPI, budget, and date
Capital plan by source
Equity rounds sized to milestones
Non-dilutive funding captured (grants, tax credits, government loans)
Eligibility criteria and application timeline for non-dilutive sources
Capital efficiency signals
Burn multiple (if generating revenue)
$ per TRL advancement
$ per key KPI improvement (e.g., cost to improve yield 10%)
Unit economics at scale (target COGS, gross margin path)
Runway to next inflection point
Exit logic
Potential acquirer archetypes and strategic rationale
Comparable transactions in your space
Readiness triggers for M&A or IPO
Pitch framing: Show a clear milestone staircase where each step unlocks the next round at higher valuation. Highlight capital efficiency wins and non-dilutive leverage to maximize equity value.
Using the 5Cs to Frame Your Pitch
The 5Cs exist to answer one question: Why will desperate customers pay you, and why can't they get this anywhere else?
Your pitch connects them like this:
Context — What broke that made customers desperate NOW?
"Six months ago, this was a nice-to-have. Today, [regulatory change / cost threshold / physical limit] means they can't operate without this."
Customer — Who is so desperate they're already paying you?
"This anchor customer moved from interested to desperate when [catalyst]. They signed an SOW. They're measuring success on [KPI]. If we hit spec, they'll deploy across [X] facilities."
Not: "We talked to 50 companies and they liked it."
Yes: "This one company has budget allocated, a deployment timeline, and their CEO is tracking our milestones."
Company — Why can you actually deliver what desperate customers need?
"We own the [physics/process/data] that solves their problem. Our IP means we're the only ones who can [specific claim]. We've de-risked [technical barrier] that killed prior attempts."
Competition — Why can't desperate customers get this anywhere else?
"Incumbents can't do this because [architectural constraint]. New entrants can't catch us because [switching costs / data moat / process know-how]. We've cornered [specific advantage]."
Capital — What does it cost to scale desperate customers?
"We need $X to move from one desperate customer to proof that this scales. Milestone: [field deployment with Y customers], which unlocks [next round of desperate buyers]. At that point, we're worth [valuation] because [repeatable sales motion / margin proof / category leadership]."
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